The U.S. Securities and Exchange Commission (SEC) staff has issued new guidance explaining how federal securities laws may apply to certain crypto assets and transactions.
The FAQ, published on Sept. 25, provides further details on the SEC’s March 2026 framework for classifying crypto assets and determining when a token may be tied to an investment contract.
The guidance clarifies that an issuer’s own descriptions of a token’s functionality and decentralization can be important when determining whether it has fulfilled promises made to investors. The SEC staff also provided guidance on staking receipt tokens, wrapped tokens and other crypto-related instruments.
The FAQ says a staking receipt token can be treated as a digital tool when it simply represents ownership of an underlying digital commodity. In some cases, however, it may qualify as a digital commodity itself, particularly when issued by a protocol-based liquid staking provider.
The SEC also addressed promotional activity. Marketing that highlights a crypto system’s existing features and utility would generally not, by itself, amount to a promise to carry out essential managerial efforts. Similarly, broad statements about a project’s potential features may not create an investment contract when they do not promote the possibility of profits.
The guidance also says that once a crypto system becomes functional, activities such as maintaining, improving or securing the network generally would not be considered the type of essential managerial efforts that could make a token subject to an investment contract under the Howey test.
For fully functional systems with no central party, statements from an issuer are also less likely to create a new investment contract because no single party would have enough control over the system to determine its success or failure.
The SEC staff further clarified that token buybacks do not automatically amount to a promise of managerial efforts. For functional crypto systems, buyback announcements generally would not qualify. For systems that are still being developed, however, a buyback could be viewed differently if it is presented as a way to generate returns for token holders.
The SEC stressed that the FAQs are staff guidance, not new rules or regulations. They do not have the force of law or change existing legal requirements.
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